In a 2009 study, researchers from Massachusetts Institute of Technology reported that 92 percent of respondents said their company was addressing sustainability in some way. However, over 70 percent stated that their companies had not developed a clear business case for sustainability. Business leaders play a key role in defining and implementing sustainability initiatives.

Sustainability

Over the past few decades, the definition of sustainability has expanded from an environmental focus to include economy and social equity. Companies interested in sustainability measure and report on their performance across the triple bottom line, which consists of economic, environmental and social criteria. Investors’ increased interest in business sustainability led to the creation of the Dow Jones Sustainability Indexes in 1999. The indexes benchmark the performance of the world’s leading companies based on triple bottom line reporting.

Role of Business

At the beginning of the 21st century, several multinational companies recorded annual sales which exceeded the economic activity of a small country. Multinational companies dominate the global market, with 500 companies accounting for 70 percent of international trade. Unless multinational companies conduct their business in a manner which is economically, environmentally and socially sustainable, they risk putting their suppliers out of business, losing the support of the community in which they operate or alienating their customers. Business leaders must rise to the challenge of making business sustainability a workable strategy.

Barriers to Action

Business leaders face barriers to implementing sustainability programs. Managers may find it difficult to gather information on sustainability because definitions of sustainability differ between companies and industry sectors. Leaders find it difficult to construct a business case for sustainability because the results are often intangible and delivered over a long time frame. Even businesses that are committed to sustainability find it difficult to engage the workforce due to outdated views on sustainability. The lack of tangible deliverables makes it difficult to evaluate and report on sustainability initiatives.

Leadership

The 2009 MIT study identified top-down vision, commitment and leadership as essential for the success of sustainability initiatives. Business leaders must gather hard data on the financial, social and environmental benefits of sustainability in order to create a compelling business case. Leaders must define measurable goals and objectives which can be evaluated and results reported to demonstrate to stakeholders that the investment in sustainability initiatives is worthwhile. Business leaders must communicate their vision with enthusiasm to convince their organizations to commit to sustainability programs.

About the Author

Lynne MacDonald has experience in the fields of human resource management, training, organizational development and law. MacDonald received a law degree from the University of Dundee in 1990 and holds diplomas in personnel management and legal practice. She is a Fellow of the Chartered Institute of Personnel & Development.